FCB, Bozell merger hits barrier at London shops

LONDON--True North Communications is calling off the marriage between Foote, Cone & Belding and Bozell Worldwide here.

True North last month announced plans to fold the international offices of Bozell into the new FCB Worldwide, maintaining separate offices only in the U.S., mostly due to client conflicts. But Bozell managers in the U.K. wanted to keep running their own agency, despite being offered top jobs in the merged FCB European network.

The holding company now is finalizing an agreement to allow London-based Delaney Fletcher Bozell to become an independently operated agency under the existing management team of Greg Delaney and Mark Lund, chairman and chief executive, respectively.

True North will have a "substantial minority stake" in the Delaney agency, said Harry Reid, president of international for FCB Worldwide.

London-based Banks Hoggins O'Shea/FCB, led by John Banks, will remain part of the FCB network.

MANY CLIENT CONFLICTS

"The issue was one key thing--in our business, we are all client-driven. There were more direct client conflicts than were initially apparent. Instead of rushing ahead and merging willy-nilly, we pulled back and thought about it more carefully," Mr. Reid said.

Messrs. Delaney and Lund declined repeated requests for an interview.

Bozell's international accounts, mainly DaimlerChrysler and Uni-sys, will move to Banks Hoggins while both agencies will keep their own local accounts, Mr. Reid said.

Some of the Bozell account directors and creatives working on the international accounts will move to FCB.

"Our aim is to provide continuity," he said.

FCB and Delaney's extensive list of U.K. client conflicts include Barclays Bank's b2 financial product with a local bank called Save & Prosper; Brittany Ferries with Hovercraft, two rival boat services between the U.K. and continental Europe; the Daily Mail newspaper with The Financial Times; Tropicana with Del Monte; and Buena Vista Home Entertainment with CIC Video.

Mr. Reid said True North is not considering keeping any other FCB and Bozell offices separate. He rebuffed speculation that executives at Delaney were strongly against a merger.

"This has never been an adversarial situation. Both agencies have been the best of pals," he said.

An executive who requested anonymity at Delaney also said reports of "ill feeling" between the agencies were exaggerated.

Asked if it was Delaney's idea to remain independent, Mr. Reid said carefully: "At the end of the day, it was a collective True North idea."

MEDIA PLANS

The Bozell shop, whose new name has not been finalized, will continue to handle its media buying and planning through an existing joint venture with CIA Medianetwork.

True North is looking at how to handle media buying and planning on a global basis, Mr. Reid said.

Currently, True North and Dentsu are the world's largest ad organizations not controlling a global media specialist. During a previous joint venture with Publicis, now dissolved, FCB relied on Publicis-owned Optimedia to handle its media work internationally.

TN Media only operates internationally in Canada, Mexico and a couple of Latin American countries. FCB uses a variety of arrangements, including its own FCB offices, Optimedia and CIA Medianetwork, elsewhere in the world.

"We are searching for ways to become much more competitive," Mr. Reid said. "It's a major focus for us that will be resolved in coming months."

Mr. Reid said FCB is actively looking at eight or nine acquisitions in Europe.